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Inflation spike prompts business rates rise fears
Nov 04 2011 17:08:29 , 1613

Printers have called for the government not to implement business rate increases based on the September RPI inflation rate, which at 5.6%, was at its highest for more than 20 years.

 

Since 1990, governments have linked the Uniform Business Rate to the previous September’s inflation figure. However, even though the year remained steady, between 5%-5.2% from April through to August, September was far larger, suggesting an increase that ratings experts believe could yield an additional £1.35bn in business rates across all industry sectors next year.

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Duarte Goncalves, managing director at Manchester-based digital printer DXG, said that print businesses were already "swimming against a tide of costs" and called for the government to help cut its costs.

He said: "They need to hold prices for a year. A lot of businesses have already gone and those that are left are not getting any help from the government, how can we be expected to replace B1 equipment when margins are getting ever smaller?

"If there is anything to hold back another increase in costs we should all stand together and ask for that."

Glossop Cartons managing director Jacky Sidebottom said that an increase of the magnitude suggested by the RPI could very well be the "straw that breaks the camels back" for many companies.

She added: "Personally, I don’t think the government should increase it at all, I don’t think a lot of people will stand for it. We get little enough support as it is. I don’t think the government will have the bottle to hit us with a 5.6% increase, but I fully expect them to increase it about 3%. It certainly would not be well received if they went the whole hog."

Minuteman director Lucie Wise said that, even if the government does go ahead with a 5.6% rise, it should take into account smaller companies.

She said: "We are not excited about this rise. We are watching costs and expenses so it isn’t fantastic when something comes along that you have no control over, it seems unfair.

"Ideally the government won’t increase the rate, but if it does, I hope it also increase our small business relief inline with the rate increase. If government wants us to trade it would be good to have its support behind us."